CHAPTER 1

 
THE STRATEGIC ROLE OF HUMAN RESOURCE
MANAGEMENT (HRM)
OBJECTIVES: To Develop an Understanding of …….
• The Historical Development of HRM
• The Difference between Personnel and HRM
• The Role of HRM
• The Functions (Areas) of HRM
• The Future Challenges of HRM
• Environmental – Organizational Framework
• Macro-Environmental Analysis (MEA)
• MEA and the Strategic Linkage to HRM
• Business and HR Strategies
 Evolution of (Strategic) HRM
• Administrative Era (Prior to 1935)
• Labor Relations Era (1935 – 1963)
• Federal Involvement (Social Legislation) ERA
(1964 – mid 1980s)
• Resource Scarcity Era (mid 1980’s – Present)
• Global Dimension Assuming Greater
Recognition in the 1990s
 Primary Role of HRM
• Help the organization manage its human
resources efficiently and effectively.
• Planning, developing and implementing
human resource objectives, policies, and
procedures that enhance employee
contributions to the organization through
increases in productivity, quality of work
life and legal compliance
 Primary Role of HRM
• Satisfactorily meet societal and employee
needs, demands and expectations
• Reconcile conflict between organizational
objectives and employee objectives
 Primary Goals of HRM
• HRM programs and policies are
implemented to:
– attract
– select
– retain
– develop
– motivate employees to achieve organizational
goals.
 HR Functions
• Employment Law
• Job Design and Job Analysis
• Recruitment
• Selection
• Training & Development
• Performance Appraisal
• Compensation - Salary and Benefits
 HR Functions
• Safety & Health
• Employee Rights –Discipline/Termination
• Labor Relations
 Key HR Challenges for Today’s
Managers
Environment
• Rapid Change • Legislation
• Workforce Diversity • Evolving Work and Family Roles
• Globalization • Skill Shortages and the Rise
of the Service Sector

Organization
• Competitive Position: Cost, • Self-Managed Work Teams
Quality, Distinctive Capabilities • Small Businesses
• Decentralization • Organizational Culture
• Downsizing • Technology
• Organizational Restructuring • Outsourcing
Individual
• Matching People and Organization
• Ethical Dilemmas and Social Responsibility
• Productivity
• Empowerment
• Brain Drain
Fig. 1-1 • Job Insecurity
© 1998 by Prentice Hall
 WHO is Responsible for the
Management of Human Resources?

• All managers/supervisors
• The HRM department
 Impact of the following on HRM
Practices
• Aging of the labor force
• Shift from a manufacturing to a service
economy
• Increasing number of dual-career families
• Increasing number of women and minority
workers in the labor force
• Increasing number of college graduates and HS
dropout entering labor force
• Organizational re-engineering and restructuring
 Where the Jobs Are: The Rise of the
Service Sector
Non-farm Employment, 1975-2005
150 130.2
113.3
107.3
89.4
100 76.7
54.1

50
22.6 23.9 22.9

0
1975 1995 2005
(projected)
Goods-producing Service-producing Total
Fig. 1-2a © 1998 by Prentice Hall